Bitcoin (BTC) and Ethereum (ETH) have experienced a significant uptick in value, propelled by a fresh wave of short liquidations that has intensified bullish sentiment in the cryptocurrency market.
According to data from Coinglass, total liquidations across the crypto sector reached approximately $138.23 million, with over $95 million coming from short positions. This represents a striking 71% of total liquidations, underscoring the overwhelming pressure on short sellers.
Liquidation Dynamics Fueling Market Momentum
The current surge in short liquidations typically results in increased buying pressure, contributing to upward price movement for cryptocurrencies. Ethereum led the charge with $27.69 million in liquidations, including $23.84 million from short positions and $3.85 million from long positions. As of the latest update, ETH has risen by 3.1% over the past 24 hours, trading at $2,730.
In a notable turn of events, Ethereum’s trading volume soared by 117%, reaching $17.4 billion, as investor interest spiked amid the liquidation frenzy. The largest single liquidation order recorded occurred on Binance, the world’s largest cryptocurrency exchange, amounting to $6.64 million in the ETH/USDT trading pair.
Bitcoin’s Steady Rise
Bitcoin also made headlines, with liquidations totaling $25 million, comprised of $21 million from short positions and $4 million from long positions. This surge propelled Bitcoin’s price to a four-month high of $69,460 earlier today. Despite a slight correction, Bitcoin remains up 0.45% over the past day, currently trading at $68,700.
The trading volume for Bitcoin saw a remarkable increase of 74%, now standing at $24 billion. The global cryptocurrency market capitalization has hit a three-month high of $2.49 trillion, as many leading altcoins also record significant gains, according to CoinGecko.
Potential Risks Ahead
While the current environment appears favorable for BTC and ETH, analysts caution that if long positions begin to liquidate, it could create substantial selling pressure as traders rush to minimize their losses. As the market continues to evolve, investors are advised to remain vigilant and consider the inherent volatility that characterizes the cryptocurrency landscape.
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